Study: DVRs no big threat to advertising

Janet Babin Jun 1, 2007
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Study: DVRs no big threat to advertising

Janet Babin Jun 1, 2007
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KAI RYSSDAL: I say Nielsen, chances are you think television ratings. The company’s made millions selling those audience figures to broadcasters. Which then charge advertisers billions to peddle their products to those audiences. Modern technology’s been a boon to both sides of that equation. Networks now know much more specifically how many people are watching their shows. And thanks to some new data out this week advertisers know how many are, or aren’t, watching their commercials.

Janet Babin reports from the Marketplace Innovations Desk at North Carolina Public Radio.


JANET BABIN: TV executives watch TV too. They know that sometimes you just flip to another channel during commercials. And if you have a DVR, a digital video recorder, you can just fast-forward.

James McQuivey with Forrester Research says $70 billion in ad revenue is at stake. So the TV networks wanted to keep what happens during the commercials a mystery:

JAMES MCQUIVEY: They’re just afraid that if we find out that nobody’s watching the commercials that they won’t be able to charge as much money.

About 17 percent of Americans have DVRs. Nielsen’s study is the first to look at how many DVR users actually watch ads. The data suggests more than half of viewers skip them — fewer than some had feared. Advertisers have long argued they should pay less for the air time if people aren’t watching. Try convincing the TV companies.

James McQuivey says fall ad rates will probably remain steady.

MCQUIVEY: The goal of the network is to preserve revenue. So if it means they raise rates in order to keep the revenue at the same level, they will do that.

The proliferation of channels and shows on the Internet has also put pressure on ad rates.

Brian Steinberg with Advertising Age says the people making TV commercials will have to come up with creative tricks to get us to watch TV ads:

BRIAN STEINBERG: I think we’re going to see more attention paid to product placement, putting products into shows, with new commercial formats like taking over an entire commercial break.

Nielsen’s revised ratings system will also measure how many people tune in live, and how many use their DVRs to watch a few days later.

I’m Janet Babin for Marketplace.

KAI RYSSDAL: I say Nielsen, chances are you think television ratings. The company’s made millions selling those audience figures to broadcasters. Which then charge advertisers billions to peddle their products to those audiences. Modern technology’s been a boon to both sides of that equation. Networks now know much more specifically how many people are watching their shows. And thanks to some new data out this week advertisers know how many are, or aren’t, watching their commercials.

Janet Babin reports from the Marketplace Innovations Desk at North Carolina Public Radio.


JANET BABIN: TV executives watch TV too. They know that sometimes you just flip to another channel during commercials. And if you have a DVR, a digital video recorder, you can just fast-forward.

James McQuivey with Forrester Research says $70 billion in ad revenue is at stake. So the TV networks wanted to keep what happens during the commercials a mystery:

JAMES MCQUIVEY: They’re just afraid that if we find out that nobody’s watching the commercials that they won’t be able to charge as much money.

About 17 percent of Americans have DVRs. Nielsen’s study is the first to look at how many DVR users actually watch ads. The data suggests more than half of viewers skip them — fewer than some had feared. Advertisers have long argued they should pay less for the air time if people aren’t watching. Try convincing the TV companies.

James McQuivey says fall ad rates will probably remain steady.

MCQUIVEY: The goal of the network is to preserve revenue. So if it means they raise rates in order to keep the revenue at the same level, they will do that.

The proliferation of channels and shows on the Internet has also put pressure on ad rates.

Brian Steinberg with Advertising Age says the people making TV commercials will have to come up with creative tricks to get us to watch TV ads:

BRIAN STEINBERG: I think we’re going to see more attention paid to product placement, putting products into shows, with new commercial formats like taking over an entire commercial break.

Nielsen’s revised ratings system will also measure how many people tune in live, and how many use their DVRs to watch a few days later.

I’m Janet Babin for Marketplace.

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